Moronic Monday Thread for the week

  1. That depends on the nature of the expense - whether it is considered a taxable benefit or not. If your employer reimburses you for the cost of a flight that you took for business purposes, then not taxable. But if they also paid for your spouse to fly with you, then that second ticket would be a taxable benefit.

  2. I seriously don’t understand TFSAs. Years ago, TD asked me if I wanted to set one up and have my savings move x amount of money to it whenever I used my debit card, so I said sure, which still happens today. On average I may contribute $50 that way monthly, nothing crazy.

  3. At $50/month ($600/yr) you're only using up a tenth of your new room each year, so your available contribution room is growing quite fast. Plus depending when you turned 18 you may have been building up room before TD set up your account. So you can definitely put a few thousand in there without worry. I would advise against putting in the full amount shown on the CRA website though, as that number is often out-of-date and there's no way to know which contributions have been included in calculating that. Anyone who is coming close to maxing out their TFSA room should do a review of all past contributions (less any withdrawals), to calculate how much was used, and then compare that total to this chart (valid for 2022):

  4. Much more important than how much you contribute (or can contribute) to your TFSA is in what your TFSA is invested. If it's just a savings account making 0.1% interest, then you should probably reevaluate what you are doing.

  5. What are websites where Canadian houses are listed by sellers without using a real estate agent? I swear I saw some of those websites listed in a comment a couple days ago, but my googling on the topic showed empty/sketchy results.

  6. We listed our house last year on Kijiji, Facebook Marketplace, and HonestDoor. We got only 1 inquiry via HonestDoor and that was a realtor wanting to sell it for us, lol. A few of those on Kijiji too. Most buyers interested now seem to be shopping on Facebook Marketplace, though we also got quite a lot of interest just from the lawn sign - so whatever you do, put up at least a nice looking FOR SALE sign out front! Listing on MLS was by far the main way we found interest. It cost us $500 with a realtor willing to do a "mere posting" for us, plus about $150 for mandatory professional room measurements - we bundled that with a 3D photographer and got photos and a 3D tour for about $300. Another $15 to register a custom domain for our house website (had it linked from the MLS listing), but the site got very few visits so that was probably a waste of our time. It took longer than we expected to sell, but in the end we had 3 interested parties and two of them put on a little bidding war (really only brought their offers up to asking price though). One had a Realtor and the other didn't, but the one with the Realtor had a more attractive offer and secured financing, and we were able to get the Realtor to accept a much lower commission than our initially offered 3.5% (standard for Alberta).

  7. Last time I went through this, I was told that even with a positive balance, it counts as a cash advance and you'll be charged a crazy interest rate to take the money out of the credit account. Better to just pay off the other if you can and slowly buy off the balance on the other.

  8. Why do most people totally ignore interest payments when they talk about how much they paid for a house. For example someone who bought a house for $500k 10 years ago paid at least $200k so far in interest with a 30 year mortgage amortization. But they will always say their total cost was $500k

  9. Their total cost was $500k. It is now $700k, but nobody asks "Hey buddy, how much have you paid for your house to date?" They just want to know what you paid initially.

  10. Human nature. Also, you don't really know what your total interest costs will be until your final term, so it would be just as silly to assume the same interest rate for 25 yrs.

  11. GIC's are offering equal or even higher returns than blue chip dividend stocks. Does it make sense to move away from equities into GIC's considering how volatile the stock market is right now? I am thinking for the small amount I have invested in a non-registered account.

  12. Keep in mind for a non-registered account, interest is taxed the same as your income. How much of a loss would you take now to sell and how long are you looking to lock in the GIC for? Assuming we are down 20% and it takes 3 years to even that means 25% upside from here. That would be approx 8%/year at a better tax rate over 4%/year interest and no access to funds.

  13. I've just qualified as a flight instructor and I've been offered a position at a school as a contractor. I'll be working in Ontario.

  14. It depends on what services your financial advisor is providing in return for those high fees, and how much you value those services. If all he/she is doing is taking your money and investing if for you with the occasional get-together to see how things are going, you're probably not getting your money's worth because you can easily do the same thing yourself. If they are providing advanced tax optimization, offering advice on retirement planning or withdrawal strategies, or other advisement services that you are benefiting from, then maybe consider these high fees as payment for those services.

  15. XEQT/XGRO/VEQT/VGRO are sub 0.25% MER, and can be bought commission free on numerous discount brokerages such at Questrade, or WS Trade.

  16. The idea behind all-in-one asset allocation ETFs is that you just pick one that best suits your needs, and just keep buying that one ETF. It keeps things simple and easy for you (they take care of rebalancing) and the MERs are reasonably low. It is important that you choose the ETF that's right for you though. You might want to check out the risk questionnaire found

  17. my lender doesn't allow heloc mortgages, but I'm wondering about a secured LOC against our equity. Is there any big downside to pursuing this? The aim would be to fund the construction of an accessory building for rental.

  18. When you say "secured against our equity" I presume you're referring to some investments, not the equity in your home (as that would just be a HELOC). It's a little riskier because of the higher chance that the lender calls the loan in the event of a major market crash that lowers the value of your equities to below the loan balance. I would only use such a loan as a last resort, if I couldn't find a HELOC somewhere. You don't have to get it from your primary mortgage lender. Check with a mortgage broker to find out more about your options!

  19. You don't need a lawyer, but it could be a good idea. Just make sure you find one with experience writing up rent-to-own contracts. If you go on your own, you'll need to find a template for a contract and make sure everyone fully understands everything it says.

  20. Any draw-backs for doing Norbet's Gambit in a non-registered account? I have done it previously in my RRSP and TFSA - just wondering if its still viable to do it in a non-registered account and if I should be expecting anything different

  21. Do we have to use the same mortgage broker when we renew our mortgage in 3 years? We didn’t love him but didn’t know better (first time homebuyers) and I’d rather not have to use him again but I don’t want to pay penalties or anything.

  22. Well, if you're going to always have wifi then you could use a service like Fongo. They have unlimited texting plans for as cheap as $10 for 6 months. It's still using wifi (or mobile data if you have it) to send/receive messages between your phone and the Fongo servers, so you won't be able to use it unless you have access to data. You also have to use the Fongo app on your phone (cannot use your favorite SMS app). Between Fongo and the recipient, it will use SMS, so it will look like a regular text to them and they can use whatever app they normally use for SMS. They have rigid anti-spam rules, so be careful not to send more than 10 messages per minute (pretty tough to exceed under normal circumstances) as they may block you.

  23. Yes because the money is already in the registered plan. I'm not 100% familiar with the Ontario rules but will explain using AB and it will be similar.

  24. I'm currently helping my father in-law sell his car on FB marketplace and Kijiji. Do I need to have a carfax report with my ad?

  25. You don't need it, and probably most ads don't include it automatically. Some buyers may ask to see it, others won't trust you and will pay for their own report anyways. Personally I'd wait and see if anyone actually asks you for it before spending the money.

  26. is there an obvious answer to if I should I make extra payments on my mortgage or fill my TFSA (60% equity 40% fixed income with wealthsimple) first?

  27. Best way to look at this is by treating the extra mortgage payments as a form of investment. It's somewhat like a GIC, in that your capital is guaranteed and is basically locked in for 5 year periods (you can usually cheaply refinance to get your equity back when renewing). Since you're on a variable rate, the rate of return would match that - which of course is still quite unpredictable right now. One big advantage of extra mortgage payments is that your return is tax-free without occupying space in a registered account. But if you have plenty of space anyways, that's not such a big bonus.

  28. What does it take to get started with investing in real estate in Metro Vancouver, assuming I've followed all the PFC money steps? I have maxed out my TFSA and RRSP and should be able to set aside as much as half my paychecks for the next while since my expenses are low and I live with my parents.

  29. What's going on with house insurance? There has been a double-digit increase every year for several years now. It can't all be blamed on Covid-related supply chain issues or the cost of building materials because this was happening before Covid also. Just received my annual renewal and I am now paying double for my house insurance than I do for my car. I have not made any home insurance claims for the past 25 years.

  30. They offer an initial low rate to pull you in, then increase it as time goes on. This is to get you as a customer and best other quotes because most people never change or shop around once they are with a company.

  31. I want to get personal lines of credit with as many banks as possible. What impacts the approval of a personal unsecured LOC? For example, if I switch my payroll to the new bank for 6 months then apply, would that impact chance of approval? Thanks!

  32. An unsecured line of credit requires, good credit, good income( capacity to pay) and they like to see a good net worth. They will use some calculations called TDSR and GDSR. TDSR is total debt servicing Ratio, what you actually owe on debt and expenses, and GDSR, which is gross debt servicing ratio, what you would owe in the event you max everything out. Each LOC will increase those ratios and you will only, if you qualify, be able to get a limit or limits up to the allowable percentage that will be based on your actual and current situation. The banks also don’t like to see someone out “credit shopping” and may deny you based on multiple applications. Switching your payroll, opening an account will do nothing if you don’t qualify based on the above.

  33. I applied for my dad for the Disability Tax Credit June 25th online, with status of "received" on June 25. CRA finished the review and mailed out the results August 10th, but I was able to see it on the website (I think under "benefits and credits") August 15th.

  34. I have around 50k in savings, and I am worried to buy a one bed room apartment in Burnaby, BC! Currently I am debt free so it’s a plus, but I do not want to be tied to paying mortgage for another 10 years or so! How to get out of this dilemma!

  35. Remember if you buy a condo, there will be extra expenses come up. My father lives in a condo and right now they voted that every owner pay 15k to repair the balconies that were not built to code. So make sure you have more money set aside for stuff like that. If you don't like the idea of randomly having to pay a 15k bill, don't buy a condo

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